Central Group delays new construction starts despite record sales and land acquisitions

Central Group reported strong results in 2025, including record apartment sales and continued expansion of its land bank, but has decided to postpone the launch of new construction projects by around one year due to high construction costs and capacity constraints in the sector.

According to the company, it sold 1,200 apartments last year and acquired land for the development of approximately 5,300 apartments, financed entirely from its own resources. Central Group said it now holds land suitable for the construction of around 40,000 apartments in total. Despite this, the developer stated that it will not start new projects until prices for construction supplies fall by at least 10%, based on its internal market analysis.

The postponement does not affect projects already under construction. Central Group currently has around 3,200 apartments under way, working with 15 general contractors. The company argues that limited competition among contractors and high capacity utilisation are pushing prices to levels it considers unsustainable.

Dušan Kunovský, Founder and CEO of Central Group, said: “Iconic world hockey player Wayne Gretzky always said that it doesn’t matter where the puck is now, but you need to see where it will be in a moment. And that’s how we need to look at the current construction and housing market. The huge overheating of the construction industry is no longer sustainable, and we need to let the market cool down for a while so that it can function normally again.”

Central Group pointed to broader market indicators, including a sharp decline in the number of building permits issued in the Czech Republic last year, which it expects to affect housing supply in the coming years. The company also referred to its experience during the 2022–2023 inflationary period, when construction costs later corrected after a slowdown in new project launches.

Kunovský added: “The prices of construction supplies have skyrocketed hysterically in the last year. Developers can no longer accept this and further increase the prices of apartments for people. This overheating needs to be calmed down. After all, over the last 10 years, the prices of new apartments in Prague have increased by an incredible 170%. The main reason is dysfunctional permitting and a shortage of apartments on the market. But another major problem is the disproportionate increase in construction supply prices.”

Despite delaying new starts, Central Group said it expects to have around 2,000 apartments ready for construction during 2026 and will proceed once cost conditions improve.